3723 Johnson St NE

Columbia Heights, MN 55421

$339,900F

3 bd · 2.0 ba · 1,266 sqft · Built 1955 · SingleFamily · Pending · 149 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,954/mo
• Mortgage (P&I): −$1,782
• Tax + insurance: −$527
• HOA: −$0
• Vac / Maint / Mgmt: −$410
• Net cashflow: $-766/mo
• Annual: $-9,197/yr
• Cap rate: 3.59%
• Cash-on-cash: -9.66%
• DSCR: 0.57
• 1% rule: 0.57%
• Cash to close: $95,172

Investor read

• This is a 3-bed/2.0-bath single-family listed at $340k.
• At list price, monthly cash flow is $-766 ($-9k/yr) — negative.
• To cash-flow at today's rent, offer at most $205k (39.8% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $195k (42.5% below list).
• It's been on market 149 days — a 12% lower offer ($299k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $195k (42.5% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $10k of value loss. Plan a longer hold.
• Location reads 74/100 on livability (#215 in MN, #4,509 nationally) — a middle-class / working-renter tenant base. Strengths: commute A+, housing A+, cost of living A-; Watch: crime C-, amenities D-, health & safety F.
• Columbia Heights Public School District (suburban): math 11% / reading 22% proficiency, ranked #291 of 301 in MN (top 97%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 68% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Highland Elementary (math 17% / reading 22%, grade F, #759 of 857 statewide, top 90%, 512 students, 85% FRL); Columbia Academy (math 10% / reading 24%, grade F, #241 of 258 statewide, top 94%, 664 students, 84% FRL); Columbia Heights Senior High (math 30% / reading 34%, grade F, #333 of 471 statewide, top 71%, 1,092 students, 81% FRL).
• Watch-outs: built in 1955 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+4.5%/yr); 145 active listings in the ZIP; 32 comparable units currently listed for rent nearby; rentals at typical pace (median 20d on market — plan ~3-4 weeks tenant-placement turnaround); 1,083 units permitted in Anoka County in 2024 (134 in 5+ unit buildings).
• Anoka County population projected at +11% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 5 sale attempts since 2y ago; this cycle's ask has dropped $35k (9%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• This rent runs 33% of the median local income ($71k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• What do current leases actually rent for vs. the listed asking? Can we see a recent rent roll and the last 12 months of T-12 income?
• It's been on market 149 days. Have you received any prior offers? Is the seller open to a 43% concession, seller financing, or rate buy-down credit?
• Built in 1955 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Why hasn't it sold? Are there any deal-killer items the seller is aware of (foundation, flood, title, zoning, code violations)?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are D-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• The area grade is low — what's the realistic commute time and amenity access for the typical tenant pool here? Any planned neighborhood developments (good or bad) we should know about?
• What's the average days-on-market for RENTAL listings here right now (not sales)? A rising rental-DOM trend means longer vacancies and softer asking-rent achievability than the comps imply.